# Thinking about opening a cigar lounge



## Tonybone

I have been contemplating for the last year if I am going to open a cigar lounge or not. I have decided to go ahead and go forward with it and find out some info about costs and just general tips for getting this ball rolling. If there are any cigar shop owners out there that can share some pointers about how you guys went about gettin your business going, that would be grreeaat! Thanks.


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## Nickerson

I'm sure it would cost quite a bit. Excluding the cost of the building. You will probably need to drop around $100,000+ on the insides for furniture, televisions, lockers, smoke eaters, etc.

Would be a nice business to own though. Not sure how profitable they are.


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## The Waco Kid

Tony,

I don't run a cigar lounge - I'm just amazed that they can stay in business. I'm not trying to rain on your parade! But it seems like you'd have to sell a LOT of cigars to turn a profit.

There are plenty of references on the Web to writing a business plan. I've started a couple of businesses, and I can tell you that you have a much better chance of success with a plan. At the worst, you'll know ahead of time what your cost of goods sold will be, what your fixed and variable costs will be, how much you can charge, and therefore what your volume has to be if you are to be profitable. You'll then have to decide how much work you'll have to put in to turn that level of sales. The few shop owners I've seen have a huge amount of expertise and put in a lot of time. You'll also need to figure out what you need to do to make people visit your shop instead of one of the other shops in Houston. You can do some research on that right here - ask folks 'what do you like about your current B&M and what do you really wish they had?".

If this is a labor of love - that's very important but not quite sufficient. You also have to be smart about the plan - make sure you know how you are going to attract folks that already have a 'home' B&M. Or find an underserved area, there may not be any B&Ms in Pasadena or Clear Lake for instance. You also have to be willing to work much harder than you probably expect.

Good luck to you! I don't spend much time in the B&M but I'll be sure to visit yours once you get it open!


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## ckay

I think everyone who enjoys this hobby had at one point thought about this.

Here is an excerpt from an older post elsewhere.



> I opened a cigar shop with lounge in missouri last sep. I can send you the business plan I used to get my SBA. Let me be clear. Making money takes time. At least a couple of years. I have 30k+ in ventelation and believe me you can never have to much. A stand alone building will be pricey. You will need to do 50k in sales per month probably if your rent is around 50k per year. That is hard to do. Also if you have a liquor license in most states it limits your ability to be open sundays. If you are serious about wanting more info PM me and I will be glad to set a time when we can talk on the phone. BTW stay away from Franchises they just complicate things and cost you money. IMHO


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## Tonybone

I just got done reading an article about profits and expenses for owning a cigar/smoke shop. Melendi, a cigar shop owner in Manhattan says to open just a cigar shop, not a lounge that I had in mind that includes a members only bar in the back, should expect to spend $500,000+ on just the cigar shop(furniture, humidor, supplies, etc.). Melendi also suggests that you should have around $2 million in the bank just in case....:jaw: However after your first year or two and a stable clientele base, your ROI will beat least 15-20%. Profits will be nice once I get there....but as with any business, the first few years are always the toughest. Looks like I have a bit of saving up to do, but I still think it would be awesome to own a really exclusive cigar lounge.


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## TonyBrooklyn

Lakeman said:


> Tony,
> 
> I don't run a cigar lounge - I'm just amazed that they can stay in business. I'm not trying to rain on your parade! But it seems like you'd have to sell a LOT of cigars to turn a profit.
> 
> There are plenty of references on the Web to writing a business plan. I've started a couple of businesses, and I can tell you that you have a much better chance of success with a plan. At the worst, you'll know ahead of time what your cost of goods sold will be, what your fixed and variable costs will be, how much you can charge, and therefore what your volume has to be if you are to be profitable. You'll then have to decide how much work you'll have to put in to turn that level of sales. The few shop owners I've seen have a huge amount of expertise and put in a lot of time. You'll also need to figure out what you need to do to make people visit your shop instead of one of the other shops in Houston. You can do some research on that right here - ask folks 'what do you like about your current B&M and what do you really wish they had?".
> 
> If this is a labor of love - that's very important but not quite sufficient. You also have to be smart about the plan - make sure you know how you are going to attract folks that already have a 'home' B&M. Or find an underserved area, there may not be any B&Ms in Pasadena or Clear Lake for instance. You also have to be willing to work much harder than you probably expect.
> 
> Good luck to you! I don't spend much time in the B&M but I'll be sure to visit yours once you get it open!


I must piggy back on what Lakeman has said here. Also consider the stricter requirements for opening such an establishment. Then there are internet sales how do you compete with that. Also with the economic climate being what it is today. I wish you much luck with your idea!


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## ckay

It's like this...you are passionate about something, you look for ways to make a living from it. We all day dream about it...whether it is owning a B&M, lounge, playing on the PGA Tour. The reality of it isn't so bright. A lot of sacrifice and the risk of failure will always be there.

But at the end of the day, he who has the biggest balls prevails.


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## Tonybone

I also think it will take a long time to get my sales to where I would like them to be. Being a business owner right now, I know what kind of time and energy is put into making your business a success. Although the labor of love thing is whats kind of drawing me towards this business idea, I also agree that from an investment standpoint, the ROI doesn't seem that great. I'm going outside to talk to H. Upmann about a Grande Maduro and see what he says lol... eace:


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## Jordan303

I was sitting ina cigar lounge a few months ago in miami and couldnt stop but think how they make money. Then I began thinking how I would have done it to turn a maximum profit. I think that cigars have a very niche market. That being said that market is a very loyal niche market. BUT the alchohol market is much much bigge. If it was marketed as either a cigar bar or a wine and cocktail cigar bar I think would turn a bigger profit just because more people drink than smoke, and when people drink they generally drink more than one. When peole smoke they generally only smoke one.

Now I am not a buisness student I don't own a buisness, its not my trade. Just an opinion and an observation.


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## TTHunter

No smoking in public places in Houston. Not sure you would get around that. Though there are some shops currently but I wonder if they were grandfathered. 

Like any retail business - location, location, location. And even with everything done right you still have to compete with online sales. This would be a tough business to get into.


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## thegoldenmackid

I know competition is a good thing and Houston is a big city, but there are a decent amount of quality B&Ms in Houston... 

Amongst all the other issues.


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## Turtle

A few things to think about.

First, here's a link from the forum going over some more costs, ideas, etc. http://www.cigarforums.net/forums/vb/general-cigar-discussion/271179-opening-b-m-tobacco-shop.html

Second, the thought has been bandied about here locally with a group of 5 guys/investors. After years of tweaking plans, really the only way to make money that we have seen is to be located fairly centrally (downtown would be preferrable), you HAVE to have a lounge, and the lounge needs to be nice and welcoming. Alchohol is a must - this is where the profits come in. The rest, nice chairs, speakers, tv, etc will come or change how you need. But you need to have a welcoming atmosphere, and alchohol to pay the bills.

Unfortunately easier said than done - that requires a license, and normally those are hard to come by/insanely expensive.

Hope we can keep pointing you in the right direction.


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## afilter

Wish you the best with this. The few that still exist around here had to foght with the libs over the smoking ban....finally common sense prevailed and they grandfathered in the Cigar lounges who business model was based on smoking if the local community did not object.

One nut job actually proclaimed that she was so glad for the smoking ban becuase she could not go and enjoy the nice leather furniture at one of the local cigar stores....DUH!! they are not there for you.

Back on topic the ones that I see that are still in business tend to combine with other sales like alchol. One prominate one is a cigar and Wine store.

Best of Luck!


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## GentlemanJester

I think the scariest thing to me is where is the legislation going to be in 5 years? Open a shop, dump a lot of money into it, and then the government tells you to shut down? I hope it doesn't happen, but I think its the way we're headed.


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## cigars4me2

Please send me a copy of your business plan as I am interested in opening a lounge.

Thanks,
Dave



ckay said:


> I think everyone who enjoys this hobby had at one point thought about this.
> 
> Here is an excerpt from an older post elsewhere.


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## ghe-cl

Among the first things you'll need to explore are the necessary licenses, such as the tobacco license from the ATF and whatever alcohol license is required in Houston in addition to the regular business licenses. Getting the tobacco license can be a time consuming process and in most cities getting a license for beer and wine isn't too hard, but for liquor is very tough. Also, in a place like Houston where there are lots of shops, you may also run into difficulties getting some cigars because shops with established accounts may not want the competition and the manufacturers may go along with them. If you are serious, I would make contact with some shops that are similar to what you want to open in other Texas cities like Dallas, San Antonio, etc., that wouldn't consider you competition and discuss the concept seriously with various owners.


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## rickturco

can I also get my hands on that SBA proposal/biz plan?

thanks
Rick


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## ghe-cl

Interestingly, I have had several cigar-bar owners tell me they didn't make anywhere near as much on alcohol sales as they had expected. What they said they found was that it is extremely difficult to get anyone in the shop who isn't a cigar smoker, i.e., someone who's just interested in drinking. And many women just won't come in because of the smoke, so that cuts into couples stopping in to drink.


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## KeeperSmith

TTHunter said:


> No smoking in public places in Houston. Not sure you would get around that.


I don't know about Houston, but when I was living in Chattanooga, TN there were a couple of smoking clubs there that got around some of the public smoking laws by establishing themselves as a "Private Club". They did this by charging a "membership fee". Usually it was only like five dollars, not more than the cover fee you would pay at most night clubs, and then your name was put in the register. Some of the Breweries here in NC have similar issue with only being able to serve alcohol in a "Private Club" (I'm not sure what the exact laws are concerning that, though.)
Just a thought. May not actually be feasible where you're at, but there you go...
~Keeper


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## 04EDGE40

ghe said:


> Interestingly, I have had several cigar-bar owners tell me they didn't make anywhere near as much on alcohol sales as they had expected. What they said they found was that it is extremely difficult to get anyone in the shop who isn't a cigar smoker, i.e., someone who's just interested in drinking. And many women just won't come in because of the smoke, so that cuts into couples stopping in to drink.


I know this might add to the cost and may be completely unreasonable... but I think it would be pretty cool to have a lounge that had the humidor, the bar, and smoking room all separate but accessible from each other. Maybe the bar could connect to both the smoking room and the humidor. If someone wanted a drink in the smoking room they could come out to the bar area and grab it. If you made the environment inviting enough I think you could get people in there just for the bar area and maybe they'd be inclined to buy a cigar if they smelled something they liked.

This may be completely crazy, I'm not a business owner. But I would visit a place like that for sure.


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## Fuzzy

Not sure how much hassle getting proper permits and licence cost where you are but here in Florida, I saw a decent well established cigar lounge that was furnished with leather, lots of coolers, had a nice walk in humidor with probably $25,000 in cigars+ and another $20,000 in booze with assumable licences sell for around half a million. It had an assumable lease with just over five years left and the owner trained the new owner for about two weeks. The rent was near five grand a month. Had anywhere from three employees to eight, depending on time of day. Was open from 11 am to 2 am Sunday thru Thursday and open 'til 4 am Friday and Saturday.

Was a nice place when the original owner was there (every day) even if a bit pricey. New owner (almost never there) raised prices mostly on the drinks and the place died a slow death for a year or so.


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## LGHT

You guys do know this was originally posted almost 4 years ago right?


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## 04EDGE40

LGHT said:


> You guys do know this was originally posted almost 4 years ago right?


Well. Of course we did. What do we look like... idiots?

IT WAS KEEPERSMITH'S FAULT!


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## Cigar-Enthusiast

ghe said:


> Interestingly, I have had several cigar-bar owners tell me they didn't make anywhere near as much on alcohol sales as they had expected. What they said they found was that it is extremely difficult to get anyone in the shop who isn't a cigar smoker, i.e., someone who's just interested in drinking. And many women just won't come in because of the smoke, so that cuts into couples stopping in to drink.


To me it seems pretty intuitive that couples or non-drinkers would not come to a cigar bar/lounge. The non-cigar smoking demographic probably wouldn't like the smoke.


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## KeeperSmith

04EDGE40 said:


> Well. Of course we did. What do we look like... idiots?
> 
> IT WAS KEEPERSMITH'S FAULT!


Yep... I did it... Just because the original poster may not need this thread, does not mean that there aren't newcommers for whom this topic holds relevance. That, AND then there's also the fact that while the post may be old, the original poster may still be looking for information, but gave up when the thread "died", so I breathed new life into it... Or maybe we're just expressing a case of Necro-equestrian-sadism (beating a dead horse)...

~Keeper


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## Skullkap

Ok..
So I seen that one gentleman said that he has the SBA loan business plan for this. Is that gentleman still around? Also anyone with knowledge on this matter would you PM me? Would like to pick your brain on this matter.


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## jc0655

Hello Guys,

Would anyone be kind enough to share their SBA plan with me so I can get a decent idea of costs? I am considering opening a small cigar lounge. Thanks


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## Skullkap

jc0655 said:


> Hello Guys,
> 
> Would anyone be kind enough to share their SBA plan with me so I can get a decent idea of costs? I am considering opening a small cigar lounge. Thanks


Seeking the same. Or just some information if anyone has achieved this.


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## jsimms1983

I see its been years since you posted this i hope your still around but i would like to get a copy of your business plan just to see what i would be getting myself into but would really love to open one.


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## CigarsinBerlin

I own a cigar store in Berlin and it is possible to smoke cigars in our rooms. We offer events (cigar tastings etc.)... I can say: Competition is strong and having only a lounge plus selling cigars will not be enough to earn money. Concerning legislation it can happen that it is suddenly forbidden to smoke in the lounge... That is what happened e.g. in Bavaria. The concept should probably go further, offering fine coffee, great food, best spirits... It will still be hard. However, we love our business and one day we will be sucessfull with it!


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## brazil stogie

CigarsinBerlin said:


> I own a cigar store in Berlin and it is possible to smoke cigars in our rooms. We offer events (cigar tastings etc.)... I can say: Competition is strong and having only a lounge plus selling cigars will not be enough to earn money. Concerning legislation it can happen that it is suddenly forbidden to smoke in the lounge... That is what happened e.g. in Bavaria. The concept should probably go further, offering fine coffee, great food, best spirits... It will still be hard. However, we love our business and one day we will be sucessfull with it!


I'd love to visit your business one day! Sounds perfect, great food, fine spirits and coffee!


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## bossdivaz

Could you send me a copy of your business plan as we are planning on opening a upscale cigar lounge in our area.. Any other information you have available would also be greatly appreciated.


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## whodeeni

bossdivaz said:


> Could you send me a copy of your business plan as we are planning on opening a upscale cigar lounge in our area.. Any other information you have available would also be greatly appreciated.


Someone posted that from another thread which was started years ago.

An Upscale cigar lounge is the way to go, but your feasibility study based on traffic and demographics had better be tight!

Otherwise your money will go up in smoke!

I thought long and hard about this for a while. Getting into this business with less than a million dollars is not smart at all!

I would also suggest combining something like wine and cigars but your inventory costs will go up another 500k+ to stock a decent amount of wine!


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## StogieNinja

I've said it before, and I'll say it again: While I have a huge amount of respect for anyone who has the moxy to pursue something like this, I think it's an _incredibly _risky venture to open a cigar lounge in this economic and political climate.


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## CigarsinBerlin

brazil stogie said:


> I'd love to visit your business one day! Sounds perfect, great food, fine spirits and coffee!


Do that! Visit us in Berlin! I have to add one thing: Our store concepts is supported by our online shop (www.starkezigarren.de) - the connection "online" - "store" becomes more and more important.


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## klumfuakiadi

hello how are you my name is keith and im looking to open a cigar shop in Houston can you call me 832-898-8137


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## rbdallas

Does anyone know: (for a shop around 2000 sq ft)
what the average sales per square foot is for a cigar shop ?
what is the typical % of expense allocated to rent as a % of sales ?


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## N. N. L.

Ok, I have been contemplating the same thing...A Cigar Lounge! I heard you say you could share the business plan you used to get started? That would be GREAT!!! I'm out of Akron and there is only one cigar lounge here! Let me know if you can spare a copy of that plan, it would be a definite blessing if so! Thanx alot, N.N.L. GO ZIPS!


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## ozzy1998

Hey everyone, It seems like it has been awhile since this has been an active thread but ill give it a shot. I am considering opening an exclusive members only cigar lounge in my small town of 70k. "You're nuts" you are probably exclaiming at this point but bear with me on this. Lets say i can find a commercial property in my town with between 1200 and 1600 sq ft that I can rent for $1000 a month (its possible) and i put $1000 down along with first and last months rent, 3k total. I spend 2200 on smoke eaters, 3800 on minimalistic furniture, 1000 for for decor and minor improvements such as paint, 2000 for a couple tvs, 1000 for security cams and 6k on a custom built humidified locker system with 40 to 50 units. Adding an additional $1000 to the list for any small unforeseen expenses puts me at an even 20k for the initial investment.I have 5k i can throw at this in the bank right now. If i get 50 members each paying $100 in initiation fees and $50 thereafter for monthly dues I make $5000 up front to put a dent in the remaining $15000 i have in start up costs and then i clear $1300 a month after paying rent and utilities. I would then be able to pay of my my loan of 10k in around 8 months assuming it is a low interest family or friend loan. Im not under any impression that this would be a very lucrative business or that i could sustain myself on $1300 a month but the way i see it i am getting payed 1300 a month to be able to have a place to smoke any time i want. Any thoughts here? Am i missing something or am i just high?


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## TCstr8

@ozzy1998 I'd suggest introducing yourself to the group (Cigar Puffers Introduction Forum - Puff Cigar Discussion Forums).

Just a heads up, many an entrepreneur have stopped by our little community in the corner of the interwebs with the intention of using our community for market research/info/etc. only to disappear once they thought they had the information they required. Notice that I referred to our forum as a COMMUNITY. While there are many here with plenty of knowledge they can share with you, most will be hesitant until you've shown that you plan to be a member of this community (aka sticking around and contributing to the community).

So I would humbly suggest stopping by the New Puffers forum and introducing yourself properly, giving as much or as little info as you'd like, and then reading up on the rules and browsing the forum to get a feel for things. Once you've demonstrated you don't plan on getting the info you desire and abandoning us, you'll be more apt to receive feedback from our members.

My $0.02


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## bpegler

Ozzy, that’s not how one writes a business plan. If you just want a cheap place to smoke, I would suggest your garage.


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## UBC03

The intro section us a good place for a first post..

Also look into suppliers. Most big brands want more than what you have to spend , just to provide you their cigars to sell. 

sent from Mario's wineador.. it's chilly in here.


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## ADRUNKK

The biggest cost that hasn't been figured in your calculations is the massive stock of cigars you are wanting to sell. These vendors aren't going to send you cigars on consignment. 

I second an Intro as well.


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## Brian Penrose

Don’t forget about the HVAC. The humidor will also cost a pretty penny.


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## Bird-Dog

Even if you try to do it without becoming a cigar vendor, which limits both revenues and appeal, there are two major flaws:


 No bank is going to loan you money for that, and if you prevail upon friends and family for the loan your going to be eating crow for a long, long time if/when it fails. Welcome to years and years of not smoking cigars at all while you pay off the debt!
 The prospect of 50 people lining up to hand you $100 initiation fee and $50 a month for access to a plain-Jane smoking room is pretty far-fetched. Could take years of word-of-mouth or thousands of advertising dollars (or both) to reach that level of membership, if ever.

I would say that's a losing proposition from the get-go. Take @bpeglers advice, or put your seed money into building out a man cave or backyard smoking shed. It won't make you money, but it won't lose any more than the initial build-out.


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## ozzy1998

First off, thank you for all your responses! And second i apologize if I didn't understand the cadence of posting on this forum I am a 19 yo realtor in Wyoming and I am a novice cigar smoker and thought i had found a small gap in my market for a cigar lounge. I'm not under any impression that what I gave was a full business plan just that a nugget of an idea that i have been playing around with for a few weeks. Honestly it is extremely hard to find any information about this subject online so I thought i would throw out this idea here. I think this seems like an awesome community and i would love to get involved but I am not really "forum oriented" if you will. Thank you again for responses and if you all have any other advice I would love to hear it! P.S I am not planning on selling cigars in this establishment I would provide members with locker and a place to smoke cigars in the winter months of Wyoming, the question i essentially have is; could i run this style of barebones business or am i dreamin?


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## Scap

I love these threads.

That is all.


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## greasemonger

You probably could, however I would only see it working with a theme. Like say sports (Packers maybe). There is a club/shop I go to that has a $200/year locker with benifits such as poker nights and members only events. They do things like super bowl parties as well where members and say 1 guest enter without a cover. They stay pretty busy, but they also have a pretty good inventory for the walk in customer. I would think you'd need a pretty avid member base to be a legit business, or more likely having to be doing shady things on the side there. Which would likely put you staring into a shiny badge at some point or another.


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## Matfam1

Mechanical code will require around 5000 cfm of 100% outside air. Just for fun say it’s 0F outside and you want to maintain 70F inside. Btuh=cfm*temp diff*1.08. 5000*70*1.08=378,000 btuh. That’s a lot of energy, and thats just to replace the heat you are exhausting.


Sent from my iPad using Tapatalk


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## csk415

@ozzy1998. Are you going to have someone at the lounge throughout the day or is it a membership only and you get a key to the front door? An employee would be an added expense. Your best bet is to take a poll in your area. For me, if your not selling smokes I'll smoke at home. Of course I live in Texas that has no demand for a winter lounge.

~~~~sig~~~~~

Is it cigar time?


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## Scap

Matfam1 said:


> Mechanical code will require around 5000 cfm of 100% outside air. Just for fun say it's 0F outside and you want to maintain 70F inside. Btuh=cfm*temp diff*1.08. 5000*70*1.08=378,000 btuh. That's a lot of energy, and thats just to replace the heat you are exhausting.
> 
> Sent from my iPad using Tapatalk


Use a good quality enthalpy wheel ERV and you'll have 80+% efficiency at exchanging the exhaust for intake.


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## Randy956

Great things start with an idea.. 
Do your research and perhaps it could work.

However at 61 now I'v seen things like this flop miserably. Do market research. If you can't afford that, you can't afford to open a business. Hard to hear, however, true.


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## ozzy1998

Thank you, that is all good advice. I guess in the end all markets are different and the only way to be certain is to conduct thorough market research and cost analysis. I'm going to put a pin in this idea for a while until i feel more confident in pulling the trigger on this investment but I really appreciate all of your responses and advice. If any of you have websites that you know of that would be useful for conducting more research that would be awesome but if not thank you for welcoming me into your community for a little while!


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## UBC03

ozzy1998 said:


> Thank you, that is all good advice. I guess in the end all markets are different and the only way to be certain is to conduct thorough market research and cost analysis. I'm going to put a pin in this idea for a while until i feel more confident in pulling the trigger on this investment but I really appreciate all of your responses and advice. If any of you have websites that you know of that would be useful for conducting more research that would be awesome but if not thank you for welcoming me into your community for a little while!


You can always stick around and have a smoke or two.. It's a great place to pick up knowledge that may be useful in your future endeavours.

sent from Mario's wineador.. it's chilly in here.


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## dmoe

*cigar lounge*



Tonybone said:


> I have been contemplating for the last year if I am going to open a cigar lounge or not. I have decided to go ahead and go forward with it and find out some info about costs and just general tips for getting this ball rolling. If there are any cigar shop owners out there that can share some pointers about how you guys went about gettin your business going, that would be grreeaat! Thanks.d Ritcherson


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